Legal Alert

IRS Allows Remote Spousal Consent for Retirement Plans

by the Employee Benefits and Executive Compensation Group
June 8, 2020

The IRS released Notice 2020-42, which provides temporary relief during calendar year 2020 from the physical presence requirements for participant elections in retirement plans.

Under the new guidance, there is relief during calendar year 2020 from the physical presence requirement for any participant election witnessed by a notary public through an electronic system that uses remote notarization if executed via live audio-visual technology that otherwise satisfies the requirements of state law applicable to the notary.

In addition, if a plan uses the option of having a participant make an election in the presence of a plan representative, the physical presence requirement is similarly waived during calendar year 2020 if the electronic system using live audio-visual technology satisfies the following requirements:

1. The participant must present a valid photo ID to the plan representative during the live audio-visual conference, and may not merely transmit the photo ID before or after the witnessing.

2. The live audio-visual conference must allow for direct interaction between the participant and the plan representative.

3. The participant must transmit by electronic means a legible copy of the signed document directly to the plan representative on the same date it was signed.

4. After receiving the signed document, the plan representative must acknowledge that the signature has been witnessed by the plan representative in accordance with IRS Notice 2020-42, and transmit the signed document, including the acknowledgement, back to the participant.

Copyright © 2020 by Ballard Spahr LLP.
(No claim to original U.S. government material.)

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This alert is a periodic publication of Ballard Spahr LLP and is intended to notify recipients of new developments in the law. It should not be construed as legal advice or legal opinion on any specific facts or circumstances. The contents are intended for general informational purposes only, and you are urged to consult your own attorney concerning your situation and specific legal questions you have.

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